European stocks posted modest gains on Thursday, extending a rally fueled by further declines in oil prices, though investor appetite remained tempered by lingering macro risks.
The EuroStoxx 50 rose 0.58% to 6,302.86 by midday. Outside the eurozone, Britain's FTSE 100 climbed 0.52% to 10,744.40, and Switzerland's SMI edged up 0.18% to 13,893.04.
Markets were also digesting the U.S. Federal Reserve's rate decision the previous evening. The central bank raised rates unanimously, a move that drew mixed reactions from European analysts.
Roger Rüegg, head of multi-asset solutions at Swisscanto/ZKB, said the decision reinforced the Federal Open Market Committee's hawkish posture. The updated Dot Plot projects at least one additional rate increase before year-end and signals that rates will remain elevated longer than previously expected, aimed at pushing inflation closer to the 2% target.
Jochen Stanzl, a market analyst at Consorsbank, credited the Fed with restoring some credibility lost in its recent inflation fight and called the move a demonstration of political independence.
In sector action, auto stocks led the advance after recouping some of Wednesday's losses. Volvo Cars rose 1.9%, buoyed by management comments ahead of its capital markets day that conveyed confidence on margins and market share, according to Citigroup analyst Ross MacDonald. Renault recovered 3% following a sharp drop the previous session.
Semiconductor heavyweight ASML gained 2.1%, supported by relatively stable U.S. chip stocks. In telecom, Nokia surged 6.3% after reporting an expansion of its partnership with Microsoft.
Among retailers, Next rose 0.7% on positive commentary regarding its earnings outlook. Deutsche Bank analysts highlighted the company's strong expected pre-tax profit and robust international growth trajectory.
